Chip stocks give late boost to tech sector

SAN FRANCISCO (MarketWatch) -- Technology stocks ended up putting in a mixed performance Thursday, with most chip stocks gaining ground and bellwethers such as Apple Inc. and Cisco Systems Inc. edging upward after they resolved a trademark dispute involving the iPhone name.

The settlement was announced late Wednesday. Financial terms and other similar details weren't disclosed, but both companies will be able to use the term iPhone on their products. Cisco acquired the trademark in 2000.

After see-sawing through the session, Apple
AAPL, -1.53%
shares rose 31 cents to close at $89.51, and Cisco
CSCO, -1.64%
shares rose 2 cents to end the day at $27.40.

Throughout the day, the tech sector, along with the broader market, hunted for direction amid reports that Iran failed to meet a U.N. deadline to stop enriching uranium, which some allege is being used to build a nuclear-weapons program. See full story.

Microsoft Corp.
MSFT, -1.81%
shares rose 4 cents to close at $29.39 after Google Inc.
GOOG, -3.16%
launched a slate of new business applications intended to compete against Microsoft's line of Office programs. See full story.

Google's shares gave up a penny to close at $475.85.

The chip sector got a lift from several analyst upgrades. National Semiconductor Corp.
NSM, -0.32%
shares rose $1.74, or more than 7%, to $25.39. Before the market opened, Morgan Stanley raised its rating on National Semi to overweight from equal weight on the belief that the company's earnings should improve over the next couple of years.

On Feb. 5, National Semiconductor cut its sales forecast due to lower shipments to the distributors, which are still working through excess inventory. The chipmaker expects to report fiscal third-quarter sales in the range of $426 million to $431 million, down 14% to 15% from the three months ended Nov. 26.

The lowered forecast marked the third time National Semi had cut its revenue target in the past six months. The company will report results March 8.

Analog Devices Inc.
ADI, -0.69%
saw its shares surge $3.48, or more than 10%, to $36.80 a day after the chipmaker reported upbeat quarterly results and gave a positive forecast on Wednesday. Citigroup analyst Craig Ellis raised his rating on Analog Devices' stock to buy from hold, and also lifted his 12-month price target on the stock to $44 a share from $36.

The tech-heavy Nasdaq Composite Index
$COMPQ
which rallied and retreated throughout the day, ended up rising 6.5 points to close at 2,524. The Philadelphia Semiconductor Index
SOX, -1.95%
and the Morgan Stanley High Tech 35 Index
MSH, +2.04%
also advanced.

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